Budget 2007

ateam

The budget takes place on Wednesday December 6th. With about 6 months to a general election, this budget is particularly important. Well any predictions? I think the cost of cigarettes will rise, the stamp duty will not be abolished, but I do think it will be lowered slightly and there may be some sort of scheme set up for first time buyers. I can also see a large increase in the pension. I doubt petrol or alcohol will be touched due to next year's election.

ninty9er

I can see petrol coming down and expect the PAYE bands to move upwards a nice bit. I've a feeling health and justice will be big winners

Villain

Top rate will probably drop to 40%, Fag's will go up quite a bit I reckon. The lower band will increase to keep those on minimum wages out of the tax bracket. I also suspect an increase in Mortgage Interest Relief/Tax Relief instead of stamp duty being changed.

Now thats all based on thin air of course

Hotblack Desiato

No changes to income tax rates (however strong hints will be dropped that "subject to the economic climate" and after the election...)
Bands/credits to increase in line with inflation or very slightly higher
PAYE credit may go up by a good bit more than inflation (helps 2-income families and is far less controversial than 'individualisation'.)
Some token gesture for childcare relief, nothing much
Social welfare, especially pensions and disability payments to get decent increases
No change on alcohol or fuel
50c or so on cigarettes (would be more like €5 if it was up to me!)
Stamp duty bands to increase a bit and possibly remove the trap where if you go €1 over a band, you pay the higher rate on the full price.
Possibly a reduction in bank card duty. Should be abolished, our dependence on so much cash in circulation encourages crime, increases business costs and costs a whack to mint in the first place.

Basically, "Steady as she goes, Mr. Sulu", nothing too dramatic but something there for most people. Another 2002-style pre-election party followed by a bad hangover is not going to go down well with commentators (but the electorate could be another story... sigh)

spank_inferno

No major changes methinks

Tax rates will remain the same, the bands will probably expand though.
More lower income holders will be taken out of the tax bracket.

Cigarettes and booze will go up but not by much because of their impact on the CPI/inflation stats.
Fuel wont go down as its contrary to the "polluter pays" principal
(I think this governemt is supposed to believe in that )

Pensions & Child allowences / child-care payements will increase nicely
Other social welfare payements will increase but probably by not as much.

Coming out of left-field an announcement of a new private SSIA style pension scheme for the paye workers.

High-def LCD tvs for all!

MontgomeryClift

Something to help those trying to go back to work, maybe, in light of rising unemployment figures? Unemployment has risen over 100,000 for the first time since 1998, and long term unemployment is rising.

Colonel Sanders

cigarettes - moderate rise if at all (despite all their health rantings the govt knows inflation is high enough and don't want more flak for being the cause of more inflation)
Fuel - stays the same, following on from energy price hikes and the general rise in oil prices any more duty would be extremely unpopular.
Pensions will rise significantly (irresponsible in a population with a pensions timebomb but a vote winner)
Tax free allowances and bands will rise by more than the rate of inflation and the top rate might just fall to 40% (hopefully!!!)
Stamp duty will be tweaked, possibly aimed more towards first time buyers. the 317k threshold will rise and may possibly differ by geographical region. Increased levies should be placed on owners of multiple properties but no chance of it happening.
Further tax incentives towards pension holders. All ssia's did was expand the amounnt of money banks could lend and was an economic disaster.
Credit card duties should be reduced but no chance of this happening, the 40 euro duty is completely unjustifiable.

Hotblack Desiato

Colonel Sanders wrote:

cigarettes - moderate rise if at all (despite all their health rantings the govt knows inflation is high enough and don't want more flak for being the cause of more inflation)

It's crazy that tobacco is included in inflation figures.
Hmmm the way things are going the CSO will have to include the price of a gram of coke in their figures :eek:

Stamp duty will be tweaked, possibly aimed more towards first time buyers. the 317k threshold will rise and may possibly differ by geographical region.

In other words give the Dubs a bit of a break seeing as though they're being crucified with house prices? It'll never happen, there's a reason Dublin's infrastructure was let deteriorate to breaking point before anything at all was done. We hear the odd poster here saying stuff like "ye all have Luas and Dart and Port Tunnel and Metro on the way and what do we get" as if we all have a Luas stop outside our front door :rolleyes:

Anything that is seen to favour Dublin is a sure-fire vote loser elsewhere in the country. Dublin is under-represented in the Dail and politicians don't care because Dubs don't bother to vote as often as the rest of the country.
Also Dublin tends not to generate single issue candidates - but whip up enough of a storm about the closure of the clinic in the local boreen and you have a ticket to Dail Eireann.

Increased levies should be placed on owners of multiple properties but no chance of it happening.

The last time they tried to hit investors, rent went through the roof due to lack of supply of rented accommodation. All that does is hurt the people who can't afford to buy in the first place. "You can't buck the market" is an old saying but true, whenever governments try to interfere with one thing they end up screwing up something else.

All ssia's did was expand the amounnt of money banks could lend and was an economic disaster.

But Irish banks don't depend on Irish deposits to provide funds for lending, they have access to huge reserves of Eurozone funding at low interest rates and with no currency risk.

Credit card duties should be reduced but no chance of this happening, the 40 euro duty is completely unjustifiable.

Actually I think there could be movement here, it's a very unpopular tax, is seen as stifling competition, hits a huge proportion of the population, and would be fairly cheap to abolish.
It's very hard to justify charging someone on minimum wage 20 quid for the privilege of accessing their wages.

MontgomeryClift

ninja900 wrote:

It's crazy that tobacco is included in inflation figures.
Hmmm the way things are going the CSO will have to include the price of a gram of coke in their figures :eek:

That would lower inflation. Illegal drugs have become much more affordable under the present government.

Zynks

In the next budget they will:

- NOT make childcare tax deductible
- NOT make it easier for people to move closer to where they work by creating exceptions in stamp duty
- NOT take steps to ensure public investment in infrastructure is good value
- NOT address the issue of 20% of houses built since 2002 being empty due to speculation
- NOT allocate decent funding to invest in sustainable energy sources

but they will:
- continue to claim they manage our money with responsibility and austerity
- give a token 1% off the higher band and increase tax free allowances close to inflation levels

and they might:
- "surprise" us all with a few stealth taxes
- make NTR owners richer by buying the West Link at a ludicrous price

admiralofthefleet

i just heard on the radio that the government ran a huge surplus this year, now before you berate me the figures were released on the evening of dec 4th (last night).
the report said that a huge surplus, similar to the type seen in the heydays of the celtic tiger in the late 90's should give brian cowen the power to be very generous.

DadaKopf

Did anyone watch Questions and Answers last night? Interesting how discussion of the budget drifted away from what can actually be contained within a budget, and other things the Government has done (or not) which affect the budget.

One audience member, while discussing stamp duty etc., mentioned something which I think is very important: introduce incentives to encourage people to rent longer. We have a buying, not a renting culture. However, most rental properties are disgusting. So, in order for the budget to work for people in this respect, we need strong tennancy laws (I can't believe we don't given our historical experience) which place enforcable higher standards on landlords and the quality of properties and which put in place strict rent control and long-term leases.

ateam

admiralgar wrote:

i just heard on the radio that the government ran a huge surplus this year, now before you berate me the figures were released on the evening of dec 4th (last night).
the report said that a huge surplus, similar to the type seen in the heydays of the celtic tiger in the late 90's should give brian cowen the power to be very generous.

I heard on the radio this morning that it might be economically advantageous to have a give away budget because consumer sentiment is quite low...I'm sure Cowen will like the sound of that!

red dave

smokes up 50c

brianthebard

live webcast here

delly

Mortgage Interest Relief doubles to €16,000 for married FTB's, but goes up from €5,080 to €6,000 for second time buyers if you know what I mean. Feck it anyway, I was only in my first house for 2 years, the 7 year thing should transfer imho.

brianthebard

€16000 for widows surely? €8000 otherwise. Bruton claims this will be negated by the interest increase that's due.

Glenbhoy

Very bad budget for me, though I guess that the rest of ye are not overly displeased - it's certainly a give-away for most, and he resisted the pressure from McDowell on stamp duty, and pulled a fast one on McDowell on the top rate decrease too!! Still, certainly won't be getting my vote.

Tazz T

A few weeks extra maternity leave but still no paternity leave - still the only country in Europe to have none.

flogen

Glenbhoy wrote:

Very bad budget for me, though I guess that the rest of ye are not overly displeased - it's certainly a give-away for most, and he resisted the pressure from McDowell on stamp duty, and pulled a fast one on McDowell on the top rate decrease too!! Still, certainly won't be getting my vote.

Why do people keep saying this about Stamp Duty.... McDowell made it perfectly clear when he started his kite flying that the abolition or reduction of stamp duty would not be a Budget 07 demand, but would be part of the PD manifesto for 2007... simply put, he knew it would be a popular idea and wants to try and use it to save his party.

I'm sure the PD's are pissed off about the top tax rate though, and the Programme for Government did promise a reduction to 40%; that said much more progress would be made by raising the level at which people come into the higher rate than by simply lowering the rate itself.

SkepticOne

flogen wrote:

Why do people keep saying this about Stamp Duty.... McDowell made it perfectly clear when he started his kite flying that the abolition or reduction of stamp duty would not be a Budget 07 demand, but would be part of the PD manifesto for 2007... simply put, he knew it would be a popular idea and wants to try and use it to save his party.

It seems to have been instigated by vested interests in the property business to explain a slow down in the market and quickly taken up by the media. Of course the slow down had started much earlier.

gurramok

flogen wrote:

I'm sure the PD's are pissed off about the top tax rate though, and the Programme for Government did promise a reduction to 40%; that said much more progress would be made by raising the level at which people come into the higher rate than by simply lowering the rate itself.

Band expanded to 34k now so according to RTE, lowering the top rate of tax to 41% affects only 20% of the workforce as the rest(80%) are on 20% tax at or below that band.

If your on 40k, not much difference today, the much higher you earn the more you get, hardly fair.
Talk about pandering to the wealthy minority by FF!

flogen

gurramok wrote:

Band expanded to 34k now so according to RTE, lowering the top rate of tax to 41% affects only 20% of the workforce as the rest(80%) are on 20% tax at or below that band.

If your on 40k, not much difference today, the much higher you earn the more you get, hardly fair.
Talk about pandering to the wealthy minority by FF!

Indeed, and while they did raise the rate at which you need to earn before you begin to pay tax, from what I can gather it's only enough to cover minimum-wage workers after the expected E1 wage rise that's on the way

Heinrich

Browne wrote in yesterday's Times :

There may have been a time when politics was about thinking through what was in society's interest and then arguing for it, trying to persuade the public to support that view.

Now politics is about finding out what people think and then persuading them that one party rather than another is the best party to give them what they want. We had a graphic and disconcerting illustration of this on television on Sunday night, with the America spin guru offering lessons on same.

Let us not forget where the money comes from and where it ends up! Then we can ponder on our shameful structures of transport, hospitals, mental health, education and try to see who benefits if indeed anyone does.

We are treated to number crunching speeches and spin to the extent that people are becoming increasing tired of the whole mess. Then when a minister performs a colossal gaffe (O'Malley) he get 100% support from the boss! Power corrupts...

bk

brianthebard wrote:

€16000 for widows surely? €8000 otherwise. Bruton claims this will be negated by the interest increase that's due.

Of course it does, but then the ECB rate increase was coming either way. I look at it from the other way, the increase in mortgage interest relief negates the ECB rate increase.

As a FTB myself, it helps greatly and Burton is just blowing smoke.

On the whole the Budget was very fair and had something for everyone. Sure lots of people/interest groups are going to complain that they didn't get more, but if they did, then someone else would have gotten less. So on the whole this was pretty fair and balanced.

spank_inferno

I agree It was fair in its distribution. If excessive in the growth of public spending. Special interest groups will always feel agrieved no matter what so you cant please every one.

Its a shame the opposition are such lame ducks.
Every year its another "lost opportunity" no matter what the government do.

IMO the government are increasing public spending too much, this will prove irresponsible in the event of an economic downturn. Ironicaly from the cut of what the opposition said the government arent being irresponsible enough

Minister of finance: "....and a golden calf for all citizens"
FG/Labour: "A disgrace and a lost opportunity to deliver 2 golden calfs!"

Sleepy

How is giving money to poor saps who can't recognise a bubble when it's raping their current account on a monthly basis in the best interests of society at large?

This budget has been a poor attempt to prop up the housing market until after the election if you ask me.

Macy

There should've been no cut in the top rate of tax, and all monies should've gone to widdening the bands, which didn't even keep up with inflation. Failure to deliver on 80% of PAYE workers pay at the standard rate is a disgrace imo, and mores the pity the unions are not kicking up about this clear committement from Sustaining Progress. No attempt at massaging the figures will change that - the committment was 80% of PAYE workers, not an average of all tax payers (which brings in all the avoidance schemes).

We'll find out today that much of the health care initiatives will be based on means testing rather than the Government actually sorting out the Health Service, and FF will be happy to hide behind the PD's on this. More costs onto health insurance down the line as well, effectively another tax rise.

50c on smokes is irrelevant, but purely revenue raising as usual. If it was a genuine health measure they'd stick a fiver on a packet.

Nothing really changed, still an extremely regressive tax regime, and nothing changed to make it fairer. Indeed a committment to make it more worse if he gets back in.